System and method for determining vehicle price adjustment values

ABSTRACT

System and method for computing price adjustment values associated with vehicle history attributes including a vehicle history database with vehicle history datasets, a transaction database, a vehicle history knowledge determination module adapted to determine whether a sale transaction related to a transaction record occurred with buyer&#39;s knowledge of the vehicle history attributes associated with the vehicle of the transaction record and to classify each transaction record based on whether buyer possessed knowledge of the vehicle history attributes, and a price adjustment module adapted to determine price adjustment values for the vehicle history attributes based on the vehicle history datasets and classification of the plurality of transaction records. In accordance with one aspect, the present invention may be implemented as a computer readable medium with instructions.

CLAIM OF PRIORITY

This application is a continuation application of U.S. application Ser.No. 10/721,780 filed on Nov. 26, 2003 entitled “System And Method ForDetermining Vehicle Price Adjustment Values”; the disclosures of whichare hereby incorporated by reference as if set forth in full in thisdocument for all purposes.

BACKGROUND OF THE INVENTION

1. Field of the Invention

The present invention is directed to a system and method for determiningprice adjustment values for vehicles. In particular, the presentinvention is directed to such system and method in which priceadjustments for a vehicle are provided based on the vehicle historyattributes.

2. Description of Related Art

The vehicle industry is perhaps one of the largest industries in manyindustrialized regions of the world. As a result, the market for usedvehicles, and especially automobiles, has evolved into a substantialmarket, especially in North America, and in particular, the UnitedStates and Canada.

Those parties involved in the trading of used vehicles recognize thevalue of information relating to the used vehicle's history in making apurchasing decision including determining a value of the particularvehicle. Consequently, services have been created that functionprimarily to provide vehicle history information to various parties inthe used vehicle market, including dealers and individual consumers. Forexample, Carfax, Inc., the assignee of the present invention, provides avariety of vehicle history information to both buyers and sellers ofvehicles. In particular, Carfax offers a web site at www.carfax.com,permitting a potential buyer or seller of a vehicle to purchase avehicle history report containing an extensive collection of informationon a particular vehicle. The vehicle history report may include suchvehicle history information as model year, odometer readings, as well asvehicle history events such as accident information, the existence ofsalvage and/or flood titles, and maintenance records.

Until now, commercial services which offer valuations of used motorvehicles have been limited to providing generic valuations, i.e. a baseprice, based primarily on the make, model and year of the vehicle. Withthe advent of online databases, the commercial online valuation serviceshave been able to factor in various vehicle information, such as thecolor or odometer reading of the specific vehicle, or the zip code inwhich the vehicle is being sold, to allow adjustment to the generic baseprice.

For example, Edmunds'® TMV Used Vehicle Appraiser (www.edmunds.com)requests the mileage, color, zip code, specific standard/optionalequipment, and vehicle condition from the user of its databases to makeadjustments to the base price for the particular make, model and year ofvehicle. These adjustments to the base price for Trade-In, PrivateParty, and Dealer Retail transactions are displayed on the pricingreport to reach a final adjusted price.

Kelley Blue Book® (www.kbb.com) has a similar process which permits anowner to assess the vehicle's condition as poor, fair, good, orexcellent, or permits the consumer to answer specific questions toassess the condition of the vehicle. Likewise, NADA Guides™(www.nadaguides.com) also has a similar process which allows theconsumer to input a zip code and mileage before submitting a request fora pricing report. The pricing report displays a price for Low Retail,Average Retail, and High Retail. Average Retail price is noted forrepresenting the price for a vehicle having a clean vehicle historyrecord. The report also displays a mileage adjustment for the mileagesubmitted by the consumer.

Other online services, such as Consumer Guide™ (www.consumerguide.com)that is powered by IntelliChoice®, provide information to dealersregarding potential customers in the market for a vehicle. Afterrequesting the make, model, year, and standard/optional equipment, thevaluation service requests the consumer to input fairly specific vehicleinformation regarding body damage, hail damage, amounts spent onunibody/frame and collision repairs, as well as data on emissionsinspections, odometer reading, registration, and clean title/brandedtitle(s). Consumer Guide™ also requests the consumer to answer questionsabout commercial use, purchase/sale at an auction, any Lemon Law claim,and any alterations made to the vehicle since it left the factory. Someof the requested information may be inputted manually by the consumerafter reviewing a vehicle history report. Once these questions have beenanswered by the consumer, the online service provides such informationto dealers who may be interested in taking the care as a trade in foranother vehicle from the dealer's inventory. Unlike the other onlinevehicle pricing services, however, the Consumer Guide™ pricing reportdoes not display specific adjustments by dollar amount or display thevalue of the vehicle.

Importantly, the available databases and online valuation servicesdescribed above do not disclose how their pricing adjustments arederived. For example, the above discussed online valuation servicesgenerally do not disclose how price adjustment values to the base priceof a vehicle are determined for any given vehicle specific information.In this regard, some of the online valuation services specificallydisclaim the accuracy of the valuation by stating that the vehiclevaluation provided by the online valuation service is an opinion only.

Moreover, the presently available databases and online valuationservices do not provide substantially automated price adjustments for aused vehicle based on specific vehicle history information that relatesonly to the vehicle being valued. Instead, if such specific vehiclehistory information is used at all, the online valuation services relyupon the consumer to acquire and provide such information to the onlinevaluation service. In particular, the above described attempts by thecommercial vehicle valuation services to provide vehicle valuationservices require interactively obtaining vehicle-specific data that ispersonally known to, or perceived by, the consumer. No vehicle valuationservice substantially automatically obtains the breadth of informationlike the vehicle history data provided in the CARFAX® database. Forexample, as previously described, the Consumer Guide™ service requiresthe consumer to manually enter the vehicle history information that isrequested.

Therefore, there exists an unfulfilled need for a system and method fordetermining vehicle price adjustments. In addition, there also exists anunfulfilled need for such a system and method in which vehicle priceadjustments are provided based on vehicle history events. Furthermore,there exists an unfulfilled need for a system and method in which suchvehicle price adjustments are substantially automatically provided tothe user without requiring the consumer to provide vehicle information.

SUMMARY OF THE INVENTION

The above described vehicle valuation providers have tried to providemodel level vehicle valuations which vary from vehicle to vehicle byinteractively soliciting vehicle specific information from the user, andfactoring the obtained vehicle specific information into the calculationof the value of the vehicle. However, the actual value of used vehiclesvaries based upon market conditions and vehicle attributes such as thespecifications of the vehicle, vehicle condition, or other circumstancespertinent to the particular vehicle involved in the transaction whichmay not be known by the user. As described more fully below, the presentinvention provides an effective system and method for calculating priceadjustment values for vehicle history attributes more accurately byutilizing empirical data to derive the price adjustment values.Correspondingly, the present invention solves the problems of the priorart and, in particular, allows more accurate determination of the valueof a particular vehicle as compared to the prior art, with minimal userinput.

In view of the foregoing, one aspect of the present invention is asystem for determining price adjustments.

One advantage of the present invention is in providing such a systemthat calculates price adjustment values for vehicle history attributesbased on actual sale transactions.

Another advantage of the present invention is in providing such a systemthat generates price adjustment values for a specific used vehicleaccurately, with minimal user input.

Still another advantage of the present invention is in providing such asystem that generates accurate price adjustments for a used vehiclesubstantially automatically based on vehicle history events specific tothe used vehicle.

In accordance with another aspect of the present invention, a method fordetermining price adjustment values is provided which can be used inimplementing the system noted above.

These and other advantages may be attained by a vehicle historyinformation system in accordance with one aspect of the presentinvention which adapted to generate price adjustment values associatedwith vehicle history attributes. In one embodiment, the vehicle historyinformation system comprises a vehicle history database, a transactiondatabase, a vehicle history knowledge determination module, and a priceadjustment module. The vehicle history database may include a pluralityof vehicle history datasets related to a plurality of vehicles, eachvehicle history dataset being related to a particular vehicle and havingat least one vehicle history attribute regarding the vehicle. Thetransaction database may include a plurality of transaction recordsrelated to sale transactions of the plurality of vehicles, eachtransaction record being related to a particular vehicle and includingat least a transaction date and a transaction price. The vehicle historyknowledge determination module is adapted to determine whether a saletransaction related to a transaction record occurred with buyer'sknowledge of the at least one vehicle history attribute associated withthe vehicle of the transaction record. The vehicle history knowledgedetermination module is also adapted to classify each transaction recordbased on whether buyer possessed knowledge of the at least one vehiclehistory attribute associated with the vehicle of the transaction record.Finally, the price adjustment module is adapted to determine a priceadjustment value for the at least one vehicle history attribute based onthe vehicle history datasets and classification of the plurality oftransaction records.

In accordance with another embodiment, a system for computing priceadjustment values associated with vehicle history attributes isprovided, the system comprising a database of a plurality of vehiclehistory datasets relating to a plurality of vehicles, each datasethaving vehicle history attributes regarding a particular vehicle, and aprocessor adapted to determine a price differential between a price of atype of vehicle when plurality of vehicle history attributes associatedwith the type of vehicle are known to a vehicle buyer, and a price ofthe type of vehicle when vehicle history attributes associated with thetype of vehicle are not known to a vehicle buyer, and to apportion theprice differential between the vehicle history attributes to compute theprice adjustment values.

In accordance with still another embodiment, a system for calculatingprice adjustment values associated with vehicle history attributes isprovided, the system comprising a database of transactional recordsrelating to sale transactions of a plurality of vehicles, each saletransaction including a buyer, a vehicle history knowledge determinationmodule adapted to analyze whether each sale transaction occurred withbuyer's knowledge of vehicle history attributes associated with arespective vehicle purchased by the buyer, and to classify the pluralityof transaction records based on respective buyer's knowledge of thevehicle history attributes, and a price adjustment module adapted todetermine price adjustment values for a plurality of vehicle historyattributes based on the classification of the plurality of transactionrecords.

In accordance with another aspect of the present invention, a system foradjusting price of a used vehicle is provided in which the price of aused vehicle is adjusted using price adjustment values for vehiclehistory attributes which are determined based on vehicle historydatasets and transaction records.

Another aspect of the present invention is in providing a method forgenerating price adjustments associated with vehicle history attributes.In accordance with one embodiment, the method comprises the steps ofobtaining a plurality of vehicle history datasets relating to aplurality of vehicles, each dataset having vehicle history attributesregarding a particular vehicle, obtaining a plurality of transactionrecords relating to sale transactions of the plurality of vehicles, eachtransaction record including at least one of date and transaction price,analyzing whether sale transactions related to the plurality oftransaction records occurred with knowledge by buyers of the pluralityof vehicles as to vehicle history attributes associated with theplurality of vehicles, classifying the plurality of transaction recordsbased on buyer's knowledge of the vehicle history attributes, anddetermining a price adjustment value for at least one of the vehiclehistory attributes based on the vehicle history datasets andclassification of the plurality of transaction records.

In accordance with another embodiment, a method for computing priceadjustment values associated with vehicle history attributes isprovided, the method comprising the steps of obtaining a plurality ofvehicle history datasets relating to a plurality of vehicles, eachdataset having vehicle history attributes regarding a vehicle,determining a price differential between a price of a type of vehiclewhen a plurality of vehicle history attributes associated with the typeof vehicle are known to a vehicle buyer, and price of the type ofvehicle when vehicle history attributes associated with the type ofvehicle are not known to a vehicle buyer, and apportioning the pricedifferential between the vehicle history attributes to generate theprice adjustment values.

In still another embodiment, a method for computing price adjustmentvalues associated with vehicle history attributes is provided, themethod comprising the steps of obtaining a plurality of transactionalrecords relating to sale transactions of a plurality of vehicles, eachsale transaction including a buyer, analyzing whether each saletransaction related to a respective transaction record occurred with thebuyer's knowledge of vehicle history attributes associated with arespective vehicle purchased by the buyer, classifying said plurality oftransaction records based on respective buyer's knowledge of saidvehicle history attributes, and determining price adjustment values fora plurality of vehicle history attributes based on the classification ofthe plurality of transaction records.

Still another aspect of the present invention is providing a method foradjusting the price of a used vehicle using price adjustment values forvehicle history attributes that are determined based on vehicle historydatasets and transaction records.

In accordance with yet another aspect of the present invention, acomputer readable medium for generating price adjustments associatedwith vehicle history attributes is provided. In one embodiment, thecomputer readable medium comprises instructions for retrieving aplurality of vehicle history datasets relating to a plurality ofvehicles, each dataset having vehicle history attributes regarding aparticular vehicle, instructions for retrieving a plurality oftransaction records relating to sale transactions of the plurality ofvehicles, each transaction record including at least one of date andtransaction price, instructions for analyzing whether sale transactionsrelated to the plurality of transaction records occurred with knowledgeby buyers of the plurality of vehicles as to vehicle history attributesassociated with the plurality of vehicles, instructions for classifyingthe plurality of transaction records based on buyer's knowledge of thevehicle history attributes, and instructions for determining a priceadjustment value for at least one of the vehicle history attributesbased on the vehicle history datasets and classification of theplurality of transaction records.

In another embodiment, a computer readable medium for adjusting price ofa used vehicle is provided, the computer readable medium comprisinginstructions for obtaining a plurality of vehicle history datasetsrelating to a plurality of vehicles, each of the datasets having vehiclehistory attributes regarding a particular vehicle, instructions forobtaining a plurality of transactional records relating to saletransactions of plurality of vehicles, each transaction record includingat least one of date and transaction price, and instructions fordetermining price adjustment values for the vehicle history attributesbased on the vehicle history datasets and the transaction records.

In still another embodiment, a computer readable medium for computingprice adjustment values associated with vehicle history attributes isprovided, the computer readable medium comprising instructions forobtaining a plurality of vehicle history datasets relating to aplurality of vehicles, each dataset having vehicle history attributesregarding a particular vehicle, instructions for determining a pricedifferential between a price of a type of vehicle when plurality ofvehicle history attributes associated with the type of vehicle are knownto a vehicle buyer, and price of the type of vehicle when vehiclehistory attributes associated with the type of vehicle are not known toa vehicle buyer, and instructions for apportioning the pricedifferential between the vehicle history attributes to generate theprice adjustment values.

These and other advantages and features of the present invention willbecome more apparent from the following detailed description of thepreferred embodiments of the present invention when viewed inconjunction with the accompanying drawings.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 is a general schematic illustration of a vehicle historyinformation system in accordance with one embodiment of the presentinvention connected to various terminals and a distributed network.

FIG. 2 is a detailed schematic illustration of the vehicle historyinformation system in accordance with one implementation of the presentinvention.

FIG. 3 shows a listing of various vehicle history attributes that may beprovided in a vehicle history dataset stored in the vehicle historydatabase.

FIG. 4 shows a listing of filter questions ordered in accordance with afilter logic in accordance with one embodiment of the present inventionthat may be used to determine whether a buyer of a vehicle had knowledgeof vehicle history attributes.

FIG. 5 is a flow diagram illustrating one embodiment of the generalmethod of the present invention.

FIG. 6 is a detailed flow diagram illustrating an example method of howthe present invention may be used.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENT

FIG. 1 is a schematic diagram of a system in accordance with one exampleembodiment of the present invention which can be used to determine priceadjustment values for vehicles. Initially, it should be understood thatthe term “vehicle” is used broadly herein to encompass a variety oftransportation devices. For example, vehicles include automobiles of alltypes, motorized cycles including motorcycles and all terrain vehicles,boats, watercraft, airplanes, etc. In this regard, the present inventionmay be implemented in the manner described to determine price adjustmentvalues for such vehicles. Thus, although the example embodimentdiscussed in detail below focuses on automobiles, it should beunderstood that the present invention is not limited thereto but may beimplemented to determine vehicle price adjustment values for anyvehicle.

FIG. 1 is a schematic diagram of a system, for example in the form of acomputer network 10, designed to implement one embodiment of the subjectinvention. FIG. 1 may also be viewed as showing the relationship of thedifferent entities potentially involved in the application of thepresent invention. Specifically, a computer implemented vehicle historyinformation system 12 exchanges data with a plurality of remoteterminals 14 through data transmission across a distributed network 16,e.g. Internet. The terminals 14 represent an individual consumer and avehicle dealer accessing vehicle history information system 12, asdiscussed more fully herein below, to obtain vehicle history informationand/or vehicle price adjustment values for a particular vehicle.

Terminals 14 may also include one or more vehicle history data sourcesor suppliers that allow the vehicle history information systemadministrator to create and update vehicle history information in system12. The vehicle history data supplier may be individual consumers,vehicle dealers, state titling offices, Department of Motor Vehicles,auto auctions and/or any other source of vehicle information. Inaddition, terminals 14 may further include transaction data source orsupplier that provides transaction records having various informationregarding a sale transaction of a particular vehicle to allow the systemadministrator to accurately determine price adjustment values inaccordance with the present invention. Such transaction records maygenerally include identification of the vehicle that is the subject ofthe sale transaction (such as VIN), transaction date, and transactionamount. Transaction data supplier may be, for example, automobiledealers, manufacturers, or other data suppliers that collect transactiondata regarding sale of vehicles.

The terminals 14 may be in communication with the vehicle historyinformation system 12 via distributed network 16. The distributednetwork 16 may be any type of communications channel such as a localarea network (LAN), wide area network (WAN), direct computerconnections, and/or wireless connections using radio frequency,infrared, or other wireless technologies using any appropriatecommunication hardware and protocols, and may further be the Internet.Thus, terminals 14 may be connected to distributed network 16 by anycommunication links 18, including hardwired and/or wireless links.Moreover, the vehicle history data supplier and the transaction datasupplier may provide information to vehicle history system administrator12 via any means of effectively communicating vehicle historyinformation, including conventional telephone, facsimile and/or mailservices indicated at 20.

FIG. 2 illustrates in more detail the vehicle history information system12 in accordance with one example embodiment of the present invention.Generally, vehicle history information system 12 may be implemented withany type of appropriate hardware and software, with portions of thesystem residing in the form of computer readable storage medium havingexecutable instructions, and computer architecture as discussed hereinbelow. Vehicle history information system 12 may be implemented using aserver, personal computer, a portable computer, a thin client, etc. orany combination of such devices. In this regard, vehicle historyinformation system 12 may be a single device at a single location asshown, or multiple devices at a single, or multiple, locations that areconnected together using any appropriate communication protocols overany communication medium such as electric cable, fiber optic cable, anyother cable, or in a wireless manner using radio frequency, infrared, orother technologies.

FIG. 2 also illustrates in more detail the preferred implementation ofthe terminals 14. Although only one terminal is shown in detail as thecustomer terminal which represents the individual consumers and vehicledealers of FIG. 1, the details of the customer terminal 14 are equallyapplicable to the data supplier terminal and/or other terminals.Terminal 14 may be any appropriate device for accessing vehicle historyinformation system 12 such as a personal computer, portable computer,thin client, a handheld device such as a mobile phone or PDA, and thelike. Terminal 14 includes an input device 22 and an output device 24which allow the user of the terminal 14 to provide information to, andreceive information from, the vehicle history information system 12 viathe distributed network 16. In this regard, the input device 22 mayinclude a keyboard, mouse, etc. as well as data input devices such asmemory devices based on magnetic, optical and/or solid statetechnologies including disc drives, CD/DVD drives, flash memory, etc.The output device 24 may include a monitor screen, printer, etc. thatallow the user of the terminal 14 to obtain the vehicle historyattribute information and/or price adjustment value information fromvehicle history information system 12.

Referring again to FIG. 2, in the preferred embodiment, vehicle historyinformation system 12 includes a price adjustment analysis unit 26, aprice adjustment database 28, a vehicle history database 30, atransaction database 32, and a communications managing module 34, all ofwhich are connected together for effective data communication. Priceadjustment analysis unit 26 in the implementation shown includes avehicle history report module 35, a vehicle history knowledgedetermination module 36, a price adjustment module 40, and a userinterface module 42, the functions of each being further describedherein below.

Vehicle history database 30 contains a plurality of vehicle historydatasets which are comprehensive collections of vehicle history dataarranged, organized, indexed and/or retrievable based on the uniquevehicle identification number (such as VIN for automobiles) of aparticular vehicle. Each vehicle sold within the United States and mostforeign countries has a unique identification number which is identifiedon nearly every vehicle title issued and physically identified on therespective vehicle. The identification is the key to identifying andtracing the public record of each particular vehicle and to associatingdifferent vehicle data collected from a variety of sources with theparticular vehicle.

It should be noted that the vehicle history information system 12 andthe price adjustment analysis unit 26 in accordance with the embodimentof the present invention is illustrated and discussed herein as havingvarious modules which perform particular functions. It should beunderstood that these modules are merely schematically illustrated basedon their function for clarity purposes, and do not necessarily representspecific hardware or software. In this regard, these modules, units andother components may be hardware and/or software implemented tosubstantially perform their particular functions explained herein. Thevarious functions of the different modules and units can be combined orsegregated as hardware and/or software modules in any manner, and can beused separately or in combination. Thus, the present invention asschematically embodied in FIG. 2 should not be construed to limit thevehicle history information system 12 of the present invention, but beunderstood to be merely a schematic example.

It should be clarified that as used herein, the term “vehicle” generallyrefers to only one particular, physical vehicle associated with a singleidentification number and does not refer to general model levelinformation or categories of vehicles. Such general model levelinformation relating to a specific make, model and/or year, is referredto as “type” of vehicle herein. Thus, the vehicle history database 30has a plurality of vehicle history datasets related to a plurality ofvehicles, each vehicle history dataset being related to a particularvehicle and having vehicle history attributes regarding the vehicle asdescribed below.

As previously mentioned, the administrator of vehicle historyinformation system 12 acquires vehicle history datasets from a varietyof data suppliers 14 including the vehicle history data supplier and thetransaction data supplier. The vehicle history datasets from the vehiclehistory data supplier which are entered into vehicle history database 30are associated with a particular identification number and thus, aparticular vehicle. The vehicle data forming the vehicle historydatasets are added as records to vehicle history database 30 and indexedby the identification number. The vehicle history datasets may beutilized by the vehicle history information system 12 in any appropriatemanner. For example, the vehicle history datasets may be utilized by thevehicle history report module 35 to generate a report by retrievingvehicle history records associated with the requested identificationnumber of a particular vehicle.

Vehicle history database 30 may be any appropriately implementeddatabase capable of effectively storing collections of vehicle historydata of vehicle history datasets in an organized accessible manner topermit efficient easy access to desired pieces of data, i.e. one or morerecords associated with a particular identification number, usingappropriate database management system software. Preferably, vehiclehistory database 30 receives information from, and may be accessed by,various components of vehicle history information system 12.

The vehicle history datasets stored in the vehicle history database 30preferably include vehicle history attributes which are vehicle historydata that provide specific information which may affect a used vehicle'svalue in the market. Such vehicle history attributes may includeaccident information, such as salvage title, junk title, flood damage,fire damage, police accident report and damage disclosure information;mileage information, such as odometer problems and actual mileagelistings; title/registration events including government registration,taxi registration and commercial registration; stolen vehicleinformation; fleet information; emissions and safety inspectioninformation; recall information, number of owners, and any otherinformation relevant to the vehicle's history and the vehicle's value.Such other information may be geographical location of the vehicle,color of the vehicle, etc., for example.

Additionally, whereas many of the above noted vehicle history attributeswould generally reduce the value of the used vehicle, some of thevehicle history attributes may increase the used value of the vehicle aswell, depending on the attribute. For example, a value of a used vehiclemay be increased if the vehicle was used in a geographical region havinga temperate climate. In another example, a value of a used vehicle maybe increased if the number of previous owners is significantly lowerthan expected for the age of the vehicle. Of course, the converse may betrue in that the value of the used vehicle may be reduced if the vehiclewas used in a harsh geographical region or has a significantly highernumber of previous owners than expected for the age of the vehicle.

In the above regard, FIG. 3 shows a listing of numerous vehicle historyattributes that may be identified and stored in the vehicle historydatabase 30 in a dataset associated with a particular vehicle. Most ofthe vehicle history attributes listed in FIG. 3 are self explanatory.More specifically, “Air Bag Deployed” vehicle history attributeindicates that the particular vehicle's air bag has deployed which meansthat the particular vehicle was in an accident. “Abandoned” vehiclehistory attribute indicates that the particular vehicle was abandoned byan owner for some reason. “Accident” vehicle history attribute indicatesthat the particular vehicle was in an accident. “Assembled” vehiclehistory attribute indicates that the particular vehicle was assembledfrom a kit instead of being assembled at a factory of a vehiclemanufacturer. “Auction Vehicle Offered” vehicle history attributeindicates that the particular vehicle was previously offered for sale atan auction whereas “Auction Vehicle Sold” vehicle history attributeindicates that the particular vehicle was actually sold.

“Child Lien Added” vehicle history attribute also listed in FIG. 3indicates that a secondary lien has been added to the ownership rightsto the particular vehicle. “Child Lien Removed” vehicle historyattribute indicates that the secondary lien to the ownership rights tothe particular vehicle has been removed. “Commercial Vehicle” vehiclehistory attribute indicates that the particular vehicle was registeredfor commercial use. “New Owner” vehicle history attribute indicates thatthe ownership for the particular vehicle changed from one party toanother. “Cert. Pre-Owned Vehicle” vehicle history attribute indicatesthat the particular vehicle is a certified used vehicle which has beeninspected and determined by, for example, the dealer, to meet therequirements established by, for example, the manufacturer forcertification that provides indication of condition and reliability ofthe particular vehicle.

“Curbstoning” vehicle history attribute indicates that the particularvehicle was sold by a dealer posing as a private owner of the vehicle,such sale tactics being generally employed when there is something wrongwith the vehicle and the dealer wants to deceive the buyer and notdisclose the problems of the vehicle. “Crash Test Vehicle” vehiclehistory attribute indicates that the particular vehicle was used invehicle crash testing. “Damaged by Fire” vehicle history attributeindicates that the particular vehicle, at one time, was on fire. “DamageDisclosure” vehicle history attribute indicates that damage to theparticular vehicle was reported, for example, by the owner. “DismantledTitle” vehicle history attribute indicates that the particular vehiclewas dismantled for parts or recycling, for example, by a salvage yard.“Emissions Inspection Failed” vehicle history attribute indicates thatthe particular vehicle failed emissions testing while “EmissionsInspection Passed” vehicle history attribute indicates that theparticular vehicle passed emission testing.

“First Owner” vehicle history attribute indicates that the indicatedregistrant of the particular vehicle is the first owner. “Fire Damaged”vehicle history attribute indicates that the particular vehicle wasdamaged in a fire whereas “Flood Damaged” vehicle history attributeindicates that the particular vehicle was damaged due to water. “FleetVehicle” vehicle history attribute indicates that the particular vehiclewas used in a commercial fleet, for example, as a company vehicle. “GreyMarket” vehicle history attribute indicates that the particular vehiclewas originally manufactured for use in another country but was importedby a dealer, and the manufacturer's warranty may be void. “GrossPolluter” vehicle history attribute indicates that the particularvehicle has emissions problems and does not meet emission requirements.“Government Vehicle” vehicle history attribute indicates that theparticular vehicle was registered for use by a government agency whichmay indicate severe usage. “Hail Damaged” vehicle history attributeindicates that the particular vehicle has incurred body damage caused byhail. “Junk Title” vehicle history attribute indicates that theparticular vehicle is no longer suitable for use on public roads.

“Lien 1 Reported” vehicle history attribute indicates that a lien hasbeen placed on the rights to the ownership of the particular vehicle,for example, by a bank, while “Lien 2 Reported” vehicle historyattribute indicates that a second lien has been placed on the rights tothe ownership of the particular vehicle, for example, a lien fromanother bank or a mechanic's lien. “Lease Vehicle” vehicle historyattribute indicates that the particular vehicle was leased instead ofpurchased. “Lemon Law Vehicle” vehicle history attribute indicates thatthe particular vehicle was defective at the time of manufacture and themanufacturer was forced to re-purchase the particular vehicle back fromthe owner under state law. “Not Actual Mileage” vehicle historyattribute indicates that the particular vehicle's odometer does not showthe actual mileage of the vehicle. “Non-Branded Buyback” vehicle historyattribute indicates that the particular vehicle was purchased back bythe manufacturer without establishing that the particular vehicle was alemon under the lemon law, thus, not requiring a lemon law vehiclehistory attribute.

“Number of Owners” vehicle history attribute indicates that theparticular vehicle has had the indicated number of owners. “Non-legalHigh Way” vehicle history attribute indicates that the particularvehicle cannot be used on public roads, for example, if the particularvehicle is a race car. “Non Profit” vehicle history attribute indicatesthat the particular vehicle was registered or owned by a not for profitorganization. “Odometer Actual” vehicle history attribute indicates thatthe particular vehicle's odometer shows the actual mileage of theparticular vehicle while “Odometer Rollback” vehicle history attributeindicates that the odometer has potentially been tampered with to show amileage less than the actual mileage of the particular vehicle.“Odometer Rollover” vehicle history attribute indicates that the mileageof the particular vehicle exceeded the five digit mechanical limits ofthe vehicle's odometer, i.e. beyond 99,999 miles, causing the odometerto be reset to zero.

“Police Vehicle” vehicle history attribute indicates that the particularvehicle was registered for police use which suggests severe usage.“Private Vehicle” vehicle history attribute indicates that theparticular vehicle was registered to a private individual. “Recall”vehicle history attribute indicates that the particular vehicle wassubject to a recall by the government and/or manufacturer. “RebuiltVehicle Title” vehicle history attribute indicates that the particularvehicle was in a serious accident but was rebuilt to be suitable foruse. “Rental Vehicle” vehicle history attribute indicates that theparticular vehicle was registered for use in a rental fleet whichsuggests severe usage. “Reported Stolen” vehicle history attributeindicates that the particular vehicle was reported to a law enforcementagency as being stolen. “Reported Veh. Damage” vehicle history attributeis the same as the “Damage Disclosure” vehicle history attribute andindicates that damage has been reported for the particular vehicle, forexample, by the owner. “Repossessed” vehicle history attribute indicatesthat the particular vehicle was recovered by a party such as a bank thathas ownership rights to the vehicle. “Safety Insp. Failed” vehiclehistory attribute indicates that the particular vehicle failed aninspection required in many jurisdictions, and by some insurancecompanies, to ensure road worthiness of vehicles whereas “Safety Insp.Passed” vehicle history attribute indicates that the particular vehiclepassed such an inspection.

“Salvaged Title” vehicle history attribute indicates that the particularvehicle was in a severe accident and was repurchased by the insurancecompany. “Taxi Vehicle” vehicle history attribute indicates that theparticular vehicle was registered for use as a taxi. “Theft Recovery”vehicle history attribute indicates that the particular vehicle wasstolen, but then was recovered. “Title Issued” vehicle history attributeindicates that a title was issued by an authorized agency for theparticular vehicle, and similarly, “Title/Regist. Issued” vehiclehistory attribute indicates that a title registration was issued for theparticular vehicle. “Total Loss” vehicle history attribute is the sameas “Salvage Title” vehicle history attribute and indicates that theparticular vehicle was in an accident and that the total value of thevehicle was paid to the insured by the insurance company that insuredthe vehicle, rather than paying for the repair of the vehicle. “VehicleRepaired” vehicle history attribute indicates that the particularvehicle had a particular problem which was repaired. “Vehicle Serviced”vehicle history attribute indicates that the particular vehicle wasserviced for routine maintenance.

Of course, the vehicle history attributes that are listed in FIG. 3 anddiscussed above are merely examples and other vehicle history attributesmay also be stored in the vehicle history database 30 as well.Preferably, the vehicle history attributes are any data that may effectthe price of the used vehicle. This information may be retrieved,processed and/or displayed in any desired manner, for example, retrievedand processed by the vehicle history report module 35 to createcorresponding vehicle history reports for a particular VIN that can bedisplayed by the user interface module 42.

In a similar manner, the transaction database 32 may be any conventionaldatabase capable of effectively storing collections of sale transactionrecords in an organized accessible manner using appropriate databasemanagement system software which allows efficient and easy access todesired pieces of data. As noted, transaction records may generallyinclude identification of the used vehicle that is the subject of thesale transaction such as VIN for automobiles, as well as specificinformation regarding the transaction such as the transaction date, andtransaction amount. The transaction database 32 allows one or moretransaction records associated with a particular identification numberto be retrieved from the transaction database 32. As previously noted,sale transaction information may be provided by a data supplier such asautomobile dealers, manufacturers, or other data suppliers. Of course,whereas in the present invention, the transaction database 32 andvehicle history database 30 are illustrated as separate databases, itshould be evident that in other embodiments of the present inventionthese databases may be combined into an integral database having boththe vehicle history datasets and the transaction records therein.

The vehicle history information system 12 in accordance with theillustrated embodiment of FIG. 2 further includes price adjustmentdatabase 28 adapted to store calculated price adjustment values forvehicle history attributes, examples of vehicle history attributes beinglisted in FIG. 3 as previously noted. The price adjustment values areeach indicative of a specific vehicle history attribute's impact oreffect on the value of the particular used vehicle. For example, if aparticular vehicle has been in a major accident or has a salvage title,such vehicle history attributes can be expected to lower the value ofthe particular used vehicle by a certain amount. By providing priceadjustment values that correspond to the vehicle history attributes, thevalue of the particular used vehicle may be accurately adjusted toreflect such vehicle history attributes, such attributes being providedby the vehicle history database 30. The price adjustment values may beexpressed in any appropriate manner such as a fixed amount, a percent ofthe value of the vehicle, or using another mathematical formula ormodel. As will be explained in further detail below, such priceadjustment values are calculated using the available vehicle historydata from the vehicle history database 30 and the transaction recordsfrom the transaction database 32.

In the preferred embodiment shown, a price adjustment analysis unit 26includes appropriate hardware and software for implementing the vehiclehistory report module 35, the vehicle history knowledge determinationmodule 36, the price adjustment module 40, and the user interface module42, each module performing the functions as described in detail below.In this regard, price adjustment analysis unit 26 may be implemented asa general purpose computing device with a central processing unit (CPU)or processor. The software for operating the price adjustment analysisunit 26 and the various modules may reside in a computer readablestorage medium in the form of encoded executable instructions thatoperate the vehicle history information system 12 and perform thefunctionalities and process steps described.

In particular, the vehicle history report module 35 functions to accessvehicle history database 30 to retrieve appropriate vehicle historyrecords associated, for example, with a particular VIN that is requestedby a user of the vehicle history information system 12. Thus, thevehicle history module 35 includes the appropriate software necessary toidentify the appropriate vehicle history dataset from the vehiclehistory database 30, and to retrieve vehicle history data based on aparticular request, for example, based on a particular VIN. The vehiclehistory report module 35 may further be adapted to arrange and organizethe vehicle history data and information in a manner appropriate forfurther data processing and/or display as a vehicle history report viathe user interface module 42 described below.

User interface module 42 is adapted to generate a user interface oroutput for delivery to output device 24 of customer terminal 14. Inparticular, the user interface module 42 may be adapted to generateparticular electronically displayable files for delivery to, and displayby, output device 24 of customer terminal 14. For example, the userinterface module 42 may utilize the information provided by the vehiclehistory report module 35 and/or price adjustment module 40 described infurther detail below to generate an output which is provided to theoutput device 24 of terminal 14. Communications managing module 34 isadapted to manage communications and interactions between vehiclehistory information system 12 and its various components, as well aswith the various terminals 14 via the distributed network 16.

As noted above, the price adjustment values that are retrievably storedin the price adjustment database 28 are calculated using the availablevehicle history datasets from the vehicle history database 30 and thetransaction records from the transaction database 32. This is attainedby the vehicle history knowledge determination module 36 and the priceadjustment module 40 of the price adjustment analysis unit 26 inaccordance with the illustrated embodiment, the details of these modulesbeing described below.

The vehicle history knowledge determination module 36 of the priceadjustment analysis unit 26 is adapted to determine buyer's knowledge ofone or more vehicle history attributes for the particular vehicle of atransaction. More specifically, the illustrated embodiment of thevehicle history knowledge determination module 36 is adapted todetermine whether sale transactions related to the transaction recordsstored in the transaction database 32 occurred, or likely occurredwithin a particular degree of certainty, with the buyer's knowledge ofone or more of the vehicle history attributes associated with thevehicle of the transaction record being analyzed.

In the above regard, the present application generally refers to buyer'sknowledge, or utilizes the phrase “buyer knew” in discussing whether asale transaction related to a transaction record occurred with buyer'sknowledge of at least one vehicle history attribute. As discussed, itshould be understood that such references to buyer's knowledge of atleast one vehicle history attribute includes actual knowledge, as wellas a determination of buyer's knowledge by inference within a specificdegree of certainty.

In addition, in the illustrated embodiment discussed, the vehiclehistory knowledge determination module 36 can also determine whethersale transactions related to the transaction records occurred, or likelyoccurred within a particular degree of certainty, without the buyer'sknowledge of one or more of the vehicle history attributes. In thisregard, the present application generally refers to buyer's lack ofknowledge, or utilizes the phrase “buyer did not know” in discussingwhether a sale transaction related to a transaction record occurred withbuyer's knowledge of at least one vehicle history attribute. Again, itshould be understood that such references to buyer's lack of knowledgeof at least one vehicle history attribute includes actual lack ofknowledge, as well as a determination of buyer's lack of knowledge byinference within a particular degree of certainty. Moreover, the vehiclehistory knowledge determination module can also determine if theknowledge of the buyer during the sale transaction cannot be determinedfor whatever reason.

The determination as to buyer's knowledge (actual or inferred) of one ormore of the vehicle history attributes may be attained in anyappropriate manner, such as based on one or more filter questions whichare analytical tools that may be used by the vehicle history knowledgedetermination module 36. For instance, this determination may be basedon buyer's interaction with the vehicle history database 30 of thevehicle history information system 12 via the user interface module 42regarding the particular vehicle being analyzed. More specifically,buyer's interaction may include the buyer's action of requesting avehicle history report from the vehicle history report module 35 for theused vehicle being analyzed via the user interface module 42. Thebuyer's interaction may alternatively be acknowledgement that a vehiclehistory report for the vehicle being analyzed was used in a saletransaction relating to sale of the particular vehicle being analyzed.The interaction may also be registration of the particular vehicle in atitle guarantee associated with the vehicle history information system12 and/or provision of comments regarding the particular vehicle beinganalyzed.

All of these interactions can be determined using filter questions,whereby answers to such filter questions provide an indication orinference as to whether the buyer of the particular used vehicle for thetransaction record being analyzed knew of the vehicle historyattributes, or that the buyer did not know of the vehicle historyattributes. Of course, the above noted interactions of the buyer withthe vehicle history information system 12 are merely examples ofinteractions that can be used by the vehicle history knowledgedetermination module 36 in determining buyer's knowledge of the vehiclehistory attributes.

Alternatively, knowledge of the buyer as to one or more of the vehiclehistory attributes may be determined by the vehicle history knowledgedetermination module 36 based on access data indicating access to thevehicle history dataset in the vehicle history database 30 which relateto the vehicle being analyzed, and based on a transactional recordrelating to the vehicle being analyzed in the transaction database 32.More specifically, the vehicle history knowledge determination module 36may be adapted to determine whether the identity of a user who accessedthe vehicle history dataset in the vehicle history database 30 regardingthe particular vehicle is also identified as a purchaser or buyer in atransaction record relating to sale transaction of the vehicle beinganalyzed. A match in the identity provides an indication that the buyerlikely had knowledge of the vehicle history attributes. Again, thisdetermination may be made using filter questions or in any otherappropriate manner.

Of course, other techniques may alternatively be used to determinewhether a sale transaction occurred with/without buyer's knowledge ofthe particular vehicle's vehicle history attributes. For example, thevehicle history knowledge determination module 36 may determine buyer'sknowledge based on filter questions that provide specific knowledge oran indication as to the likelihood that the seller of the used vehicleprovided prospective purchasers with a vehicle history report generatedby the vehicle history report module 35, or the information on such areport.

In the above regard, the vehicle history knowledge determination module36 may implement a filter logic as set forth in FIG. 4 in which answersto a series of filter questions serve as a basis for determining buyer'sknowledge of the particular vehicle's vehicle history attribute at thetime of the sale transaction of a transaction record. For example,filter question A of FIG. 4 queries whether a consumer of Carfax® ran avehicle history report on the VIN being analyzed. If the answer is yes,filter question B is queried in which a determination is made as towhether there is some buyer identification available in the transactionrecord that is related to the sale transaction of the VIN. If so, thenfilter question C is queried, and so forth.

It should be understood that the filter questions referred to above andsamples of which are set forth in FIG. 4 need not be actual questionsthat are posed to a user of the vehicle history information system 12.Rather, these filter questions represent factual inquiries for whichanswers can be provided directly by the user of the vehicle historyinformation system 12, or derived inferentially by the vehicle historyknowledge determination module 36 itself or an administrator of thesystem based on other facts or information available to the vehiclehistory information system 12. For example, such information may beaccess data noted above that indicates access to the vehicle historydataset in the vehicle history database 30.

As described, the filtration questions implemented using the filterlogic as set forth in FIG. 4 allow the vehicle history knowledgedetermination module 36 to determine whether sale transactions relatedto the transaction records stored in the transaction database 32occurred with buyer's knowledge of the vehicle history attribute(s)associated with the particular vehicle of the transaction record beinganalyzed. The filtration questions also allow determination of whetherthe sale transactions occurred without buyer's knowledge of the vehiclehistory attribute(s), or if buyer's knowledge of the vehicle historyattribute(s) cannot be determined.

In addition, as can be appreciated by careful examination, thefiltration questions also allow inferential determination of the buyer'sknowledge based on behavior of the seller and/or buyer identified in thetransaction record when specific confirming information is not readilyavailable or determinable. For example, in filtration question S, thefact that the dealer selling the vehicle generally provides vehiclehistory reports to prospective customers is used to infer that the buyerof the vehicle did have knowledge of the vehicle history attributesassociated with the particular vehicle. Furthermore, it should also benoted that FIG. 4 provides filter questions that are specific to Carfax®vehicle history services. However, similar filter questions oralternative filter questions and/or filter logic may be utilized todetermine the buyer's knowledge regarding the vehicle historyattributes.

Moreover, the answers to the filter questions as set forth in FIG. 4allow the vehicle history knowledge determination module 36 of the priceadjustment analysis unit 26 to classify each transaction record based onthe buyer's knowledge, or lack thereof, regarding the vehicle historyattributes associated with the particular vehicle. In the presentembodiment, the vehicle history knowledge determination module 36 isalso adapted to classify the transaction records of the transactiondatabase 32 into classes including a “Known Class” in which saletransaction occurred with buyer's knowledge of the vehicle historyattributes, a “Not Known Class” in which sale transaction occurredwithout buyer's knowledge of the vehicle history attributes, and an“Uncertain Class” where the buyer's knowledge of the vehicle historyattributes is indeterminate. Thus, the “Known Class” would containtransaction records in which the sale transactions occurred, or likelyoccurred, with buyer's knowledge of the vehicle attributes whereas the“Not Known Class” would contain transaction records in which the saletransactions occurred, or likely occurred, without buyer's knowledge ofthe vehicle attributes.

For example, referring again to the filter questions set forth in FIG.4, if a transaction record satisfies filter question C, the transactionrecord is determined by the vehicle history knowledge determinationmodule 36 to be in the Known Class which is designated as “KC” in FIG.4. If the sale transaction of the transaction record is determined tohave occurred without buyer's knowledge of the vehicle historyattributes for filter question H, the transaction record is determinedto be in the Not Known Class by the vehicle history knowledgedetermination module 36 which is designated as “NKC” in FIG. 4. However,if the buyer's knowledge of the vehicle history attributes areindeterminate, for example, in filter question T, the transaction recordis determined to be in the Uncertain Class by the vehicle historyknowledge determination module 36 which is designated as “UC” in FIG. 4.

As described in further detail below, the price adjustment module 40 ofthe price adjustment analysis unit 26 is adapted to determine priceadjustment values for the vehicle history attributes based on thevehicle history datasets stored in the vehicle history database 30 andclassification of the plurality of transaction records in thetransaction database 32 as attained by the vehicle history knowledgedetermination module 36 in the manner described above, for example. Theprice adjustment module 40 determines the price adjustment values forthe vehicle history attributes such as those listed in FIG. 3 based ontransaction records that are in the Known Class, as well as thetransaction records that are in the Not Known Class, transaction recordsin the Uncertain Class not being used in the present embodiment.

The price adjustment module 40 of the illustrated embodiment is adaptedto process the plurality of transaction records that are classified bythe vehicle history knowledge determination module 36 in the Not KnownClass. For example, the price adjustment module 40 of the illustratedembodiment may be adapted to determine an average transaction price fromthe transaction records in the Not Known Class for vehicles having thesame, or similar, parameters. In this regard, the average transactionprice for a type of vehicle may be calculated, i.e., for vehicles havingthe same make, model and year. This provides a baseline price for a typeof vehicle when the vehicle history attributes are not known. It shouldbe understood that as used herein, the term “vehicle parameter” refersto any information or data that may be used to categorize or group thetransaction records that are used by the price adjustment module 40 forits processing. Thus, such vehicle parameters may include the type ofvehicle as noted (make, model and year) but may further include otherparameters such as mileage, color, location, options, or even any of thevehicle history attributes referred to in FIG. 3.

Of course, in alternative implementations, the price adjustment module40 may be adapted to process the plurality of transaction records todetermine other values, for example, mean transaction price. Inaddition, various other vehicle parameters may also be used by the priceadjustment module 40 to categorize or create a focused group oftransaction records related to vehicles having one or more similar, orthe same, vehicle parameters.

In accordance with the preferred embodiment, the price adjustment module40 is further adapted to identify the transaction records for vehiclesclassified in the Known Class that have the same, or similar, vehicleparameters. Using these identified transaction records, the priceadjustment module 40 calculates a price differential between thetransaction price associated with a transaction record in the KnownClass, and the average transaction price that was determined usingtransaction records in the Not Known Class. In this regard, a pluralityof price differentials are calculated from the transaction records inthe Known Class so as to provide higher level of accuracy and confidencein the price adjustment values that are derived therefrom.

The price adjustment module 40 then determines the price adjustmentvalues by attributing the calculated price differential to the vehiclehistory attributes for the used vehicles of the transaction records inthe Known Class. Thus, the price adjustment values are determined basedon the presumption that the differences in prices between used vehiclesfor which vehicle history attributes are known/likely to be known, andused vehicles for which vehicle history attributes are not known/likelyto be not known, are directly attributable to the specific vehiclehistory attributes identified in the vehicle history datasets of theparticular vehicles in which the vehicle history attributes are known bythe buyers. In particular, the vehicle history attributes for each usedvehicle may be mathematically modeled as an equation. For example, thevalues of the vehicle history attributes may be expressed as variableswhich are multiplied with the price adjustment values which may beexpressed as unknown constants of the equations, the sum of the productsof the variables and constants for each used vehicle equaling thedetermined price differential for each vehicle. This results in aplurality of equations relating to each type of vehicle, each equationhaving a plurality of constants, i.e. price adjustment values, that canbe calculated by the price adjustment module 40 by apportioning theprice differential to the vehicle history attributes.

In the preferred embodiment, multivariate analysis may be performed inwhich the plurality of equations are solved simultaneously to calculatethe price adjustment values, i.e. the unknown constants of theequations. Such mathematical techniques for solving for multiplevariables are known in the field of mathematics and thus, are notdiscussed in detail here. Thus, the price adjustment values arecalculated using empirical data based on the actual sale prices of thetransaction records such that the price adjustment values accuratelyreflect the impact of the vehicle history attributes on the market valueof a used vehicle.

The calculated price adjustment values are then retrievably stored inthe price adjustment database 28 for use in any appropriate manner. Forexample, the price adjustment values may be displayed by the userinterface module 42 of the vehicle history information system 12 to auser requesting information about a particular vehicle in conjunctionwith a vehicle history report generated by the vehicle history reportmodule 35. Only the price adjustment values that are relevant for thevehicle, i.e. those corresponding to vehicle history attributes presentin the vehicle history report, may be displayed so that the user of thevehicle history information system 12 can take into consideration theimpact of vehicle history attributes on the actual value of theparticular vehicle. Alternatively, an actual base price of the vehiclemay be obtained and adjusted using the calculated price adjustmentvalues in the manner further described below to thereby provide accuratevaluation of a particular vehicle based on its history. When anotheruser requests information about another used vehicle, the priceadjustment values that are relevant for the vehicle can be retrievedfrom the price adjustment database 28 and displayed so that adjustmentsto the price of the used vehicle can be made.

In the above described implementation, to enhance the accuracy of theprice adjustment values calculated, the transaction records classifiedin the Not Known Class and the Known Class may be windowed by thepricing adjustment module 40 or the vehicle history knowledgedetermination module 36 so that only transaction records having atransaction date within a predetermined time window is used to determinethe average transaction price. Moreover, the price adjustment valuesstored in the price adjustment database 28 can be periodically updatedin accordance with the method described above. This will ensure that thetransaction records used to determine the price adjustment values arereflective of current market conditions and are not skewed bytransaction records that are outdated and no longer accurately reflectpresent market conditions. The window may be one year or even shortersuch as six months so that only the sale transactions that occurredwithin the time window are used.

Moreover, it should be noted that, preferably, the mathematicallymodeled equations from which price differentials are determined by theprice adjustment module 40 is for the same type of vehicle having thesame vehicle parameters. This would provide accurate price adjustmentvalues for a particular vehicle type, for example, price adjustmentvalues for 1999 Honda Accords. Of course, in alternative embodiments,price adjustment values that are generic to all types of vehicles may becalculated by determining the price adjustment values at an aggregatelevel using mathematically modeled equations for a variety of differenttypes of vehicles or based on other vehicle parameters. Such analternative embodiment may be desirable, for example, if there are notenough transaction records for one type of vehicle to determinestatistically accurate price adjustment values, for example, for highend sports cars.

As noted above, in accordance with another example implementation, theprice adjustment module 40 may further be adapted to provide valuationfor a used vehicle using the price adjustment values that areretrievably stored in the price adjustment database 28. In particular, abase price for a used vehicle may be obtained and adjusted using theprice adjustment values based on the vehicle history attributes setforth in the vehicle history dataset related to the particular usedvehicle. The base price information of vehicles may be obtained fromvarious third party databases and online services that provide suchpricing information. For example, base price for the particular type ofvehicle may be obtained from third party pricing databases such asKelley Blue Book® (www.kbb.com), NADA Guides™ (www.nadaguides.com),Edmunds® (www.edmunds.com), or any other appropriate sources. Aspreviously described, the base price of vehicles as provided by suchthird party databases represent general used car prices for a particulartype of vehicle which takes into consideration the year, make, model andmileage of the vehicle, as well as some other general information suchas options. However, such databases do not have vehicle history datasetsassociated with particular vehicles that set forth detailed informationregarding vehicle history attributes which will effect vehicle values inthe marketplace.

Hence, it should now be evident that the present invention allowsfacilitated adjustments to the base price based on each of the vehiclehistory attributes associated with the used vehicle using the priceadjustment values calculated as described herein to provide vehiclevaluation that more accurately reflects the actual value of the usedvehicle. Thus, in such an implementation, the adjusted price of thevehicle itself may be displayed by the user interface module 42 to theuser of the vehicle history information system 12. Moreover, such priceadjustment values and adjustments to the base price are provided in asubstantially automated manner with minimal input from the user of thevehicle history information system 12.

In view of the above, it should be evident that another aspect of thepresent invention is a method for generating price adjustment values. Inthis regard, FIG. 5 shows flow diagram 50 that illustrates the generalmethod for determining price adjustment values associated with thevehicle attributes in accordance with one embodiment. As shown, vehiclehistory datasets relating to a plurality of vehicles are obtained instep 51, and transaction records relating to sale transactions of theplurality of vehicles are obtained in step 52. Such data may be obtainedfrom the vehicle history database 30 and the transaction database 32 ofFIG. 2, for example.

In step 54 of flow diagram 50, a determination is made as to whethereach of the sale transactions occurred with buyer's knowledge (actual orinferred) of the vehicle history attributes associated with the vehicleof the transaction record. This step may be attained using filterquestions 53 and filter logic discussed previously relative to FIG. 4.The transaction records are then classified in step 55 based on thebuyer's knowledge of vehicle history attributes as determined in step54. For example, the transaction records may be classified into a KnownClass in which the buyer possessed knowledge of the vehicle historyattributes, Not Known Class in which the buyer did not possess knowledgeof the vehicle history attributes, and Uncertain Class in which buyer'sknowledge of the vehicle history attributes, or lack thereof, cannot bedetermined with sufficient certainty.

The price adjustment values for the vehicle history attributes are thendetermined based on the classification of the transaction records instep 59. In particular, price differentials between the pricesassociated with transaction records in the Known Class and average pricefrom transaction records in the Not Known Class are calculated in step56. The vehicle history attributes of each vehicle are thenmathematically modeled in step 57 to equal the determined pricedifferential. More specifically, price differentials are set equal tothe sum of the products of the vehicle history attributes and priceadjustment values, thereby resulting in a plurality of equations.Multivariate analysis is then performed in step 58 to simultaneouslysolve the plurality of equations to solve for the unknown constantswhich correspond to the price adjustment values for the vehicle historyattributes. Of course, the method as described in flow diagram 50 ofFIG. 5 is merely one example method of the present invention and itshould be evident to one of ordinary skill in the art that the methodmay be readily modified or changed.

For clarity, FIG. 6 illustrates a detailed flow diagram 60 whichprovides an example of how the present invention in accordance with themethod of FIG. 5 discussed above may be used. In particular, in step 62,vehicle history datasets and transaction records are obtained, forexample, from vehicle history database 30 and transaction database 32shown in FIG. 2. Such information preferably includes the VIN, sellingprice of the vehicle, mileage, transaction date, and optionally, a buyeridentifier and transaction location, as well as other information. Thevehicle history datasets further include vehicle history attributesregarding a particular vehicle, for example, one or more of the vehiclehistory attributes listed in TABLE 1 of FIG. 3. In step 64, each saletransaction associated with a transaction record is analyzed todetermine buyer's knowledge of one or more of the vehicle historyattributes for the particular vehicle being analyzed. This step may beperformed in the present implementation by the vehicle history knowledgedetermination module 36 as discussed previously utilizing the filterquestions and logic set forth in FIG. 4.

The transaction records are then classified, for example, by the vehiclehistory knowledge determination module 36, based on the buyer'sknowledge of the vehicle history attributes as determined in step 64.Data matrix 66 shows several examples of transaction records and vehiclehistory attributes from a portion of vehicle history dataset in the NotKnown Class in which the buyer did not know of the vehicle historyattributes. Of course, it should be evident that the data matrix 66 onlyshows information for three vehicles, namely, three 1998 Ford Taurusvehicles, and only several of the vehicle history attributes. Inactuality, the data matrix 66 would include expanded data with more thanthree vehicles to thereby provide a larger data pool.

Average transaction price for the type of vehicle, in this case, 1998Ford Taurus, is computed in step 68 for the transaction records in theNot Known Class. Various other vehicle parameters in addition to make,model and year may be taken into consideration in determining whether atransaction record for a particular vehicle should be used incalculating the average transaction price. For example, mileage may betaken into consideration so that an average transaction price isprovided for a particular mileage range of the type of vehicle, forexample, 0-25K miles, 26-50K miles, 51-75K miles, etc. Thus, inaccordance with the illustrated implementation, the average transactionprice is computed for each type of vehicle and the mileage ranges. Ofcourse, additional vehicle parameters to those shown in the data matrix66 may also be taken into consideration in determining whether atransaction record for a particular vehicle should be used incalculating the average transaction price as well.

The computed average transaction price as determined in step 68 is usedas a basis for determining the price adjustment values in conjunctionwith the transaction records and vehicle history datasets for the sametype of vehicle in the Known Class as generally shown in the analysismatrix 70 of FIG. 6. In particular, the same type of vehicles in theKnown Class are identified and the vehicle history datasets with thevehicle history attributes associated with the identified vehicles areretrieved, for example, from the vehicle history database 30. Again,other computed transaction price may be used, for example, meantransaction price. In addition, the transaction records regarding theidentified vehicles in the Known Class are retrieved from, for example,the transaction database 32, and matched with the vehicle historyattributes. It should be noted that in the analysis matrix 70,information for only three vehicles are shown and only several of thevehicle history attributes for these vehicles are shown for simplicityand to facilitate the understanding of this aspect of the presentembodiment. However, in actual implementation, more vehicles withcorresponding vehicle history datasets and vehicle history attributeswould be used for analysis.

In step 72, a price differential between the price associated with eachtransaction record in the Known Class, and the computed average pricefrom transaction records in the Not Known Class for the same type ofvehicle, are calculated. More specifically, the price differentialsbetween the “Vehicle Selling Price” column of the analysis matrix 70 andthe “Avg Price When History Not Known” column of the analysis matrix 70are determined. Of course, the above data matrix 66 and the analysismatrix 70 are illustrated in FIG. 6 to merely facilitate understandingof the present method of calculating the price adjustment values and donot represent a specific data structure or data format required topractice the present invention.

In step 74, the vehicle history attributes for each vehicle aremathematically modeled and set equal to the calculated pricedifferential of step 72. Thus, as shown:Price differential=aw+bx+cy+dz . . . etc.

where w, x, y, z, etc. are variables corresponding to values of vehiclehistory attributes; and

where a, b, c, d, etc. are constants corresponding to price adjustmentvalues for the vehicle history attributes.

Step 74 results in a plurality of unsolved equations corresponding toeach of the vehicles in the Known Class that are being analyzed. Most ofthe vehicles are likely to have differing vehicle history attributes andprice differentials. Thus, the variables w, x, y, z etc. will likely bedifferent for each of the vehicles.

Some vehicle history attributes are already numeric in nature, forexample, the number of owners. Other vehicle history attributes may justbe yes/no type of attributes, for example, a lemon title designation inthe vehicle history dataset. Such vehicle history attributes may beassigned numeric values so that mathematical modeling and analysis maybe performed. For instance, no lemon vehicle designation may be assigneda value “0” while a yes lemon vehicle designation may be assigned avalue “1”. Again, it should be noted that only several of the vehiclehistory attributes are modeled in the above example for simplicity inunderstanding the method of the present invention. However, the presentinvention is preferably implemented to model a greater number of vehiclehistory attributes so that price adjustment values for these attributescan be calculated.

As explained above, step 74 results in a plurality of unsolved equationshaving a plurality of constants multiplied together with thecorresponding values for the vehicle history attributes which are summedtogether to equal the determined price differential for the particularvehicle. The mathematically modeled equations are then simultaneouslysolved in step 76 to calculate the a, b, c, d, etc. constants whichcorrespond to the price adjustment values for the vehicle historyattributes. This may be attained using any appropriate mathematicaltechniques. However, in the illustrated implementation of the presentinvention, multivariate analysis is utilized to calculate the priceadjustment values, such methods being known in mathematics.

The price adjustment values calculated in step 76 are stored in adatabase in step 78, for example, in price adjustment database 28 ofFIG. 2. Of course, whereas the price adjustment values are shown asbeing calculated as a dollar amount in the illustrated example, theprice adjustment values may alternatively be calculated as a percentagevalue, or in other appropriate manner.

In use, when a vehicle history report for a particular vehicle isrequested in step 80, for instance, by a customer or user of the vehiclehistory information system 12 shown in FIG. 2, the vehicle historydataset associated with the particular vehicle is retrieved from thevehicle history database 30. The vehicle history attributes that areassociated with the particular vehicle are identified and correspondingprice adjustment values for the type of vehicle are retrieved from theprice adjustment database 28 in step 82. It should be noted that theprice adjustment values for the various vehicle history attributes shownin step 82 are merely examples only and are not actual values calculatedusing specific vehicle history datasets/transaction records.

The retrieved price adjustment values are then displayed in step 84 toallow the customer or user of the vehicle history information system 12to adjust the price of the particular vehicle in accordance with thevehicle history attributes. In this regard, the price adjustment valuesmay be displayed to the user in conjunction with a vehicle historyreport generated by the vehicle history report module 35 which setsforth the vehicle history attributes of the particular vehicle whichimpacted its value. When another user requests a vehicle history reportfor another vehicle, the price adjustment values that are applicable tothe vehicle history attributes for this vehicle can then be retrievedfrom the price adjustment database and provided to the user in a similarmanner.

Of course, as also explained previously, other implementations of thepresent invention may include the step of obtaining a base price for thetype of vehicle from a third party vehicle pricing services, andactually adjusting this base price using the price adjustment values forthe corresponding vehicle history attributes. In addition, as previouslynoted, whereas the above described embodiment focused on theapplicability of the present invention to automobiles, the presentinvention is also applicable to a variety of transportation devicesincluding motorcycles, boats, airplanes, etc.

It should further be evident to one of ordinary skill in the art thatthe present invention as described above may be readily implemented as acomputer software that is loaded to run, for example, on a computer orother computing device. Thus, another aspect of the present invention isin providing a computer readable medium for generating price adjustmentsassociated with vehicle history attributes. In one embodiment, thecomputer readable medium may comprise instructions for retrieving aplurality of vehicle history datasets relating to a plurality ofvehicles, each dataset having vehicle history attributes regarding aparticular vehicle, instructions for retrieving a plurality oftransaction records relating to sale transactions of the plurality ofvehicles, each transaction record including at least one of date andtransaction price, instructions for analyzing whether sale transactionsrelated to the plurality of transaction records occurred with knowledgeby buyers of the plurality of vehicles as to vehicle history attributesassociated with the plurality of vehicles, instructions for classifyingthe plurality of transaction records based on buyer's knowledge of thevehicle history attributes, and instructions for determining a priceadjustment value for at least one of the vehicle history attributesbased on the vehicle history datasets and classification of theplurality of transaction records.

In another embodiment, a computer readable medium for adjusting price ofa used vehicle may comprise instructions for obtaining a plurality ofvehicle history datasets relating to a plurality of vehicles, each ofthe datasets having vehicle history attributes regarding a particularvehicle, instructions for obtaining a plurality of transactional recordsrelating to sale transactions of plurality of vehicles, each transactionrecord including at least one of date and transaction price, andinstructions for determining price adjustment values for the vehiclehistory attributes based on the vehicle history datasets and thetransaction records.

In still another embodiment, a computer readable medium for computingprice adjustment values associated with vehicle history attributes maycomprise instructions for obtaining a plurality of vehicle historydatasets relating to a plurality of vehicles, each dataset havingvehicle history attributes regarding a particular vehicle, instructionsfor determining a price differential between a price of a type ofvehicle when plurality of vehicle history attributes associated with thetype of vehicle are known to a vehicle buyer, and price of the type ofvehicle when vehicle history attributes associated with the type ofvehicle are not known to a vehicle buyer, and instructions forapportioning the price differential between the vehicle historyattributes to generate the price adjustment values.

While various embodiments in accordance with the present invention havebeen shown and described, it is understood that the invention is notlimited thereto. The present invention may be changed, modified andfurther applied by those skilled in the art. Therefore, this inventionis not limited to the detail shown and described previously, but alsoincludes all such changes and modifications.

We claim:
 1. A vehicle history information system adapted to generateprice adjustment values associated with vehicle history attributescomprising: at least one processor; at least one memory device; acommunication device interface; a vehicle history database having aplurality of vehicle history datasets related to a plurality ofvehicles, each vehicle history dataset being related to a particularvehicle and having at least one vehicle history attribute regarding saidvehicle; a transaction database having a plurality of transactionrecords related to sale transactions of said plurality of vehicles, eachtransaction record being related to a particular vehicle and includingat least a transaction date and a transaction price; a plurality ofmodules borne by the at least one memory device and executable on the atleast one processor, said plurality of modules including: a vehiclehistory knowledge determination module adapted to determine whether asale transaction related to a transaction record occurred with buyer'sknowledge of said at least one vehicle history attribute associated withsaid vehicle of said transaction record, and to classify eachtransaction record based on buyer's knowledge of said at least onevehicle history attribute; and a price adjustment module adapted todetermine a price adjustment value for said at least one vehicle historyattribute based on said vehicle history datasets and further based onsaid classification of said plurality of transaction record using saidbuyer's knowledge of said at least one vehicle history attribute.
 2. Anon-transitory computer readable medium for computing price adjustmentvalues associated with vehicle history attributes comprising:instructions, borne by the non-transitory computer readable medium, forobtaining a plurality of transactional records relating to saletransactions of a plurality of vehicles, each sale transaction includinga buyer; instructions, borne by the non-transitory computer readablemedium, for analyzing whether each sale transaction related to arespective transaction record occurred with the buyer's knowledge ofvehicle history attributes associated with a respective vehiclepurchased by the buyer; instructions, borne by the non-transitorycomputer readable medium, for classifying said plurality of transactionrecords based on respective buyer's knowledge of said vehicle historyattributes; and instructions, borne by the non-transitory computerreadable medium, for determining price adjustment values for a pluralityof vehicle history attributes based at least in part on saidclassification of said plurality of transaction records using saidbuyer's knowledge of said at least one vehicle history attribute.